The invention discloses a fiber internally-reinforced wood plastic product with high impact resistance, high folding resistance and high size stability and a preparation method thereof. The product is formed through co-extrusion of a core layer and a surface layer; the core layer is composed of core layer polymer resin, fibers, plasticizer, a lubricating agent, antioxygen, core layer stabilizer and an interface modifying agent; the surface layer is composed of surface layer polymer resin, wood flour, surface layer stabilizer, calcium carbonate, a foaming agent, a foaming conditioning agent and plasticization stabilizer. The preparation method includes the steps that 1, surface layer raw materials are mixed to be uniform; 2, melt extrusion granulation is conducted, and surface layer particle materials are obtained; 3, the dried core layer resin is uniformly mixed with other core layer raw materials; 4, melt extrusion granulation is conducted, and core layer particle materials are obtained; 5, the surface layer particle materials and the core layer particle materials are subjected to co-extrusion, and the fiber internally-reinforced wood plastic product is obtained; or, the uniformly mixed surface layer particle materials and core layer particle materials are subjected to co-extrusion, and the fiber internally-reinforced wood plastic product is obtained. The wood plastic product has good impact resistance and bending resistance and is good in heated size stability.